How do elite Amazon FBA sellers stay ahead of the competition? The answer lies in their ability to leverage metrics to drive more sales and profits to their business. This sounds simple enough for any startup to understand. However; considering the huge amount of information a seller needs to track, not everyone understands how to best use these data to improve revenue.
Elite FBA sellers have encountered this dilemma early on in the game. To get to the core of the problem, they got rid of the clutter, identified crucial growth indicators and earmarked a specific group of metrics that will allow them to accomplish more with minimal effort.
To help you on your way toward entrepreneurial success, this guide will show you what tools (including those provided by Amazon) are essential for identifying useful data, leveraging your FBA metrics for higher profits, and using them to position your business for growth.
- Conversion Rate
Revenue is the lifeblood of any business. It’s the reason why we put a lot of emphasis on our conversion rate. High conversion rate also often means high revenues for your business. So when conversion rates dip below normal – we worry.
Fortunately, there are a number of things you can do to boost your conversion rate.
Review your pricing strategy. One of the quickest ways to turn an ailing business around is to offer competitive prices. This strategy will also help you win the Buy Box, to rake in more sales to your Amazon store.
Of course it pays to check similar items sold by other sellers to know where you are in the price ladder.
Offer free shipping. It’s certainly a proven way to draw the attention of buyers, not to mention the additional benefit of winning the Amazon Buy Box. This is because Amazon factors in shipping along with the cost of goods, helping to make your pricing scheme more competitive.
Take care of your seller reputation by taking care of your customers. This is where positive feedback comes in. Interact with your buyers and ask them to leave feedback. Be transparent with them and show them that you’ve given them the best service possible.
With this, you will earn your customers’ trust and confidence, encouraging them to leave favorable reviews about your products, services and business.
Another factor for a low conversion rate is low customer traffic. You can remedy the situation by creating keyword-rich product descriptions. Be sure to pick search terms that are relevant to your products and services.
Use clear high resolution pictures of your products. An attractive image has a strong tendency to attract buyers than one that is of poor quality. Also Amazon offers advertising facilities to help you bring your listing to your audience’s attention.
Regardless of how you achieve it, increasing your conversion rate will almost always lead to more sales and profits.
- Vendor Ranking
How you rank as an Amazon FBA vendor is a direct consequence of the rate you are able to sell your products. Your vendor ranking is being closely monitored by Amazon and is updated on an hourly basis.
A most viable way to improve your seller ranking on Amazon is to carry products that are the best in their category. Make sure you are well stocked to avoid disappointing your customers.
Focus on the fundamentals of selling. You can make huge leaps in your Amazon ranking just by focusing on your customers’ needs. Provide them with accurate product descriptions, informative videos and photos, great pricing and great service. These are by far the most basic and most proven methods.
- Product Ranking
Experts discovered that 90 percent of the time buyers don’t bother to look beyond the first page of search results. So if your products are on the second page, you will certainly almost never be found by your prospects. And that’s a sad thing because visibility is everything in online marketing.
The two most important conversion metrics are customer traffic and sales. Both indices also have a direct bearing on product ranking. Fail in one of these and almost immediately you’ll fail in the other as well. Therefore both metrics must be monitored together.
- Amazon Fees
Fees are an often overlooked variable for sales performance. You can’t make an accurate assessment of your sales unless your Amazon fees are factored in the equation. It is simply because Amazon fees often make a huge dent in your overall FBA costs.
For this reason, you can’t rule out fees when computing your profits. If you have just gotten on Amazon, you’ll quickly find out that items that didn’t cost much in fees are the most profitable ones to sell.
- Customer Service Dissatisfaction Rate
A lot of e-commerce strategists warn about overlooking the metrics for customer satisfaction. Doing so can be detrimental to your business.
When we have a great experience buying from a particular Amazon vendor, we oftentimes want to check out their other items to buy some more. Positive reviews are an indicator of customer satisfaction. Conversely, negative feedback tells you your services or products are bad.
Amazon recommends never allowing your Customer Service Dissatisfaction Rate to rise above 25 percent.
So now what are we going to do to drive customer satisfaction? You need to focus your attention on four sub-metrics: brand perception, customer support, price and quality.
The image you project and how others see you constitute brand perception. You see, brand perception is closely related to buyer experience. Whether positive or negative, customer perception is contagious, often transmitted by word of mouth. And customers can be a finicky lot and so it’s important to always project a positive image.
Prices too are an important factor. If you sell items that are great for the value, customers are going to come flocking to you.
And by the way, how great is your customer service? How long does it take you to pick up the phone when a customer calls? Or answer their emails? All these will add up to form customer opinion about your brand. So it’s best to always provide customers the best service you possibly can.
Last but not least is product quality. If you sell poor quality products then you will have the unpleasant experience of angry customers, high refund rates and low earnings. Product quality is a serious factor to consider when choosing a supplier.
So what makes top Amazon sellers tick? It’s simply that they’ve taken heed of these vital metrics for FBA success. You can too if you’re careful to put your customers’ interests first.
However, there are some things affecting your metrics that may be a bit beyond your control – like unpaid refunds.
As an FBA seller, you are entitled to reimbursements from Amazon for lost or damaged inventory. If you have been struggling with trying to collect reimbursements from Amazon for some time now ‑ we can help.
Seller Investigators can take care of the task of collecting or keeping track of your reimbursements for you. At FBAi, our services will free up your time so you can focus on the more important things, like running and growing your business. Take care and happy selling.